Debt and equity-linked: BBVA Paraguay

BBVA Paraguay's $100 million senior notes offering last
February was the first cross-border capital markets transaction
out of Paraguay. What made it even more interesting, there was
no guarantee from its Spanish parent and no security.

The Reg S/Rule 144A issuance required the preparation of
country disclosure for the first time, including the first rule
10b-5 opinion, and a learning process for regulators, lawyers,
accountants and auditors  some of whom had to be flown in
to assist. Pragmatic solutions were needed to efficiently
resolve discrepancies between local and international
accounting methods and regulatory requirements.

The country's sovereign rating combined with the bank's
reputation meant the covenants, for which there was no
precedent, reflect a hybrid instrument, combining investment
grade with non-investment grade features.

The first-time deal was further complicated by the issuer
being a bank.

Cleary Gottlieb Steen & Hamilton and Estudio Juridico
Gross Brown acted as US and Paraguayan counsel respectively to
the issuer.

Shearman & Sterling and Mersan Abogados acted in the
same roles to underwriters Citigroup and BBVA Securities.

Runners-up

Barrick Gold
The Canada-based gold miner's use of a front-end tender
offer, followed by a compulsory acquisition in its
takeover of Equinox Minerals last June required
financing to be locked in early, but with the
flexibility to take up only the funds it needed. Rather
than closing the $4 billion it raised in the debt
markets into escrow, Barrick included a mandatory
redemption provision in three of its four tranches of
notes, which were triggered if the acquisition of
Equinox didn't occur by a specified date. Extra
pressure was added by a competing bid for the target,
and the target having an outstanding offer to acquire
another company.

Sullivan & Cromwell was US counsel to the issuer
with Davies Ward Phillips & Vineberg acting as
Canadian counsel. The managers were represented by
Skadden Arps Slate Meagher & Flom.

Emegsa
Last year Colombia's biggest power generation company
set a strong precedent for other local issuers looking
to tap the international debt market. Its $400 million
peso-denominated senior offering was the first local
currency notes to be placed overseas. It was also the
first investment grade non-sovereign issuance out of
Colombia.

Perhaps a more important first, however, is the
strength of Emegsa's covenants. With no guarantee and
no security, the issuer was still able to borrow from
its Chilean parent's covenants, allowing it to finance
on terms not normally achieved by a Colombian issuer.
The highlight was a change of control clause which also
requires a ratings downgrade to be triggered, a gold
standard for any issuer.

Chadbourne & Parke was counsel to the issuer
with Gómez-Pinzón Zuleta Abogados
providing local law advice. The underwriters were
served by Davis Polk & Wardwell as international
counsel and Prietocarrizosa as Colombian counsel.

ICE
Costa Rica was another country to see its first rule
144A offering last year. The lack of precedent for the
$250 million issuance by government-run power company
Instituto Costarricense de Electricidad (ICE) created a
myriad of tax and structural issues to be worked
through with the local securities regulator.

It also required great emphasis on disclosures and
explanation of accounting principles to which the
international investment community is not
accustomed

ICE was represented by White & Case. The
underwriters were advised by Milbank Tweed Hadley &
McCloy as international counsel and Consortium 
Laclé & Gutiérrez as local
counsel.

ITT notes offering and tender
offer
ITT's debt offering in September marked the final stage
of a broader restructuring and re-capitalisation
exercise, but the complexities of its $1.85 million
multi-tranche issuance makes the deal worthy to include
in this section.

Having subsidiaries issue notes and dividend the
funds up the capital structure is not an unusual debt
management exercise, but in ITT's case the two issuing
subsidiaries were newly created and in the process of
being allocated ITT businesses. The lack of financial
history complicated the offering document disclosures
and projections, as did the concurrent registration of
the subsidiaries' shares.

Minerva convertible
debentures
2011 was a tough year for convertibles, yet lawyers on
Minerva's issuance pulled together a deal that would
have been impressive even in good times. The issuer
placed R$200 million floating rate convertible
debentures with local and international investors. It
marked the first public offer of convertible securities
in Brazil, and the first international convertible
offering to come out of Brazil.

The deal's lawyers had to work through
first-of-its-kind issues with the local securities
regulator and accountants regarding the notes'
treatment as debt or equity, and combine features that
satisfied Brazilian and international standards.

White & Case served as international counsel to
Minerva, with Pinheiro Neto advising on Brazilian law.
The underwriters were represented by Linklaters and
Lefosse Advogados on international and local law,
respectively.

Equity: Nielsen IPO

L-R: Chi Pan of
Simpson Thacher, Danielle Myles of IFLR

The IPO market had been less than stellar heading into 2011,
especially for private equity holders. Attorneys credit Nielsen
Company's $1.89 billion IPO last January for reigniting the
market. At the time it was the largest private equity-backed
IPO in US history. HCA surpassed that position a couple months
later.

The truly innovative part of Nielsen's IPO was the inclusion
of a simultaneous convertible bond offering, never done by a
foreign company investing into the US. The offering of
mandatory convertible subordinated bonds targeted a different
type of investor allowing for Nielsen to raise an additional
$250 million.

Nielsen was represented by Simpson Thacher & Bartlett in
the US and Clifford Chance in Amsterdam. Cahill Gordon &
Reindel counseled the US underwriters, and Loyens & Loeff
was counsel for the underwriters based in Amsterdam.

Runners-up

AIG re-IPO
The US government received a lot of criticism for using
taxpayer money in its $85 billion bailout of AIG. The
merit of this deal was thus inevitably dependent on the
US Treasury recovering an amount per share at least as
large as the price it paid in 2008. It did just that in
the public offering of 300 million AIG shares (200
million via the Treasury and 100 million offered by
AIG) at approximately $29 per share for a grand haul of
approximately $8.7 billion.

AIG was already a publicly traded company with
ongoing disclosure requirements, meaning it didn't want
too much information revealed to the public at the risk
of affecting the price of existing shares.

Davis Polk & Wardwell advised the US Treasury
and Sullivan & Cromwell acted for AIG on the
issuers' side of things. The underwriters were
represented by Cleary Gottlieb Steen &
Hamilton.

Delphi IPO
AIG's re-IPO isn't this category's only contender
involving shares purchased by the US government. Delphi
Automotive, a former branch and major partner of
General Motors, used a novel drag along deal structure
that required all holders to sell a pro-rata amount of
shares in its $530 million IPO last November.

Before Delphi could offer the shares, it had to
clean up its capital structure, which had been
complicated by US government ownership through the
Pension Benefit Guaranty Corporation. Delphi shares
also had to be repurchased from GM and a myriad of
hedge funds. This enabled a single class of equity to
be offered to the market using a lock-up and
partnership agreement.

Fibra Uno Reits
This $300 million fibra (the Mexican term for a real
estate investment trust) offering came off the heels of
a 10-year legislative push to introduce the structure
into Latin America. And this was the first. A new set
of laws on the management and disclosure of fibras,
combined with taxation issues, added to the difficulty
of this precedent setting offering.

Mexican law requires Reits to be outside managed,
meaning the Reits management company had to be a type
of subsidiary. At the same time they needed to be
structured so that returns were considered active
income for US tax purposes.

Milbank Tweed Hadley & McCloy acted as US
counsel and Robles Miaja acted as Mexican counsel to
the initial purchasers, Banco Santander and Evercore
Group. The issuer was represented by Clifford Chance in
the US and Thompson & Knight in Mexico.

HCA Holdings IPO
HCA Holdings completed the largest private equity
backed IPO in US history in March 2011 for a whopping
$4.35 billion. The offering involved a huge
underwriting syndicate, with one of the underwriters
being affiliated with an owner of HCA. Finra concerns
inevitably followed, and Merrill Lynch's one third
ownership of HCA certainly complicated things.

The offering was approved by the SEC in 2010, but
HCA decided to hold off until market conditions
improved.

Mosaic spin-off
Mosaic's $7.5 billion secondary offering of common
shares followed its $24 billion spinoff from Cargill,
the largest private company in the US. A unique set of
circumstances in which Cargill's largest shareholder
passed away leaving Mosaic shares to a group of
charitable trusts threatened Cargill's status as a
private company. To avoid tax and disclosure
implications, Cargill did an abnormally large high vote
re-capitalisation whereby Mosaic shares were sold to a
new class of Cargill shareholders. The spin-off of
Mosaic followed and was ruled tax free by the IRS.

The charitable trusts, in need of liquidity, then
sold Mosaic shares in one of the largest ever secondary
offerings of a non-financial institution, with the
remainder of Mosaic shares being sold via a three year
lock-up scheme.

High yield: CIT notes offering and exchange offer

L-R: Inosi
Nyatta of Sullivan &?Cromwell, Danielle Myles of
IFLR

Last year CIT employed some clever techniques to rid itself
of the highly restrictive covenants contained in its Series A
notes, which had been issued upon its emergence from bankruptcy
in 2009. An exchange offer for new Series C notes incentivised
investors through call protection over Series A notes, but with
an otherwise similar return. Cleverly, a $2 billion benchmark
offering of these notes was made three months prior to
establish a market for the new notes. On top of that, the
unregistered exchange offer was partnered by, not built into, a
separate consent solicitation, to ensure all investors were
offered the same terms, as required by the indenture. At its
close this became one of the largest exchange offers ever, and
showed some different ways to shake off post-bankruptcy
covenant restrictions.

Sullivan & Cromwell served as issuer's counsel and
Cahill Gordon & Reindel acted for the managers.

Runners-up

Chrysler Group
The $3.2 billion high yield offering by the Chrysler
Group last May was a crucial component of the company's
$7.5 billion refinancing, which allowed it to repay its
Tarp obligations six years ahead of schedule.
Coordinating a high yield deal with a term loan,
revolving loan, and an equity investment by new
affiliate Fiat in the 2011 bond market, and for a deal
of this size, was no easy feat.

An auto company issuing high yield debt is somewhat
of a novelty. The restrictions of traditional high
yield covenants don't sit well with the sector's
alliances, but to raise the amount of money required,
Chrysler had little choice.

CityCenter Las Vegas
refinancing
The $1.5 billion raised by CityCenter in the high yield
market last year rescued its Las Vegas-based
construction project, which was teetering on the verge
of bankruptcy. But the complications along the way are
what earn this transaction its nomination for IFLR's
inaugural high yield deal award.

The deal lawyers had to negotiate with the existing
lenders' workout lawyers, work around squabbling JV
parties, deal with an unfinished building that had
failed inspection tests, completion guarantees, and no
financials to disclose to investors.

Kinetic Concepts
The leveraged buyout of Kinetic Concepts was closely
watched by the market. It was applauded for closing at
a very difficult time in the high yield market, and for
featuring the biggest secured debt package among
post-crisis LBOs (at $6.3 billion). But it earns its
nomination for some lesser known aspects of the $2.5
billion high yield component of the acquisition
financing.

The buyer required a key business of the target to
be spun off to another part of the group prior to the
acquisition.

Kinetic Concepts was represented by Skadden Arps
Slate Meagher & Flom. Cahill Gordon & Reindel
acted for both the initial purchasers and the lead
arrangers. The acquiring consortium was served by
Kirkland & Ellis on the financing and Simpson
Thacher & Bartlett on the acquisition. The
consortium was controlled by Canadian Pension Plan
Investment Board and Public Sector Pension Investment
Board, counseled by Torys and Weil Gotshal & Manges
respectively.

OGX Petróleo e Gás
Participações
It's not often that a high yield lawyer gets to work
for a pre-production and pre-cashflow issuer, but that
was the situation for the four firms on OGX's $2.6
billion offering last May. What's more, in the months
preceding the issuance, OGX reported lower oil reserves
than expected and pushed back its first production
date. Despite this, the unsecured deal placed without
delays.

A key challenge was structuring a covenant package
for an issuer not yet generating Ebitda, and which
allowed an ambitious, developing company to grow.

Davis Polk & Wardwell and Mattos Filho Veiga
Filho Marrey Jr e Quiroga Advogados were international
and local counsel to the issuer respectively. White
& Case and Machado Meyer Sendacz e Opice Advogados
served in the corresponding roles for the
underwriters.

Warner notes offering, consent solicitation
and tender offer
Throughout its takeover by Access Industries last year,
Warner Music succeeded in keeping $1.1 billion of
secured high yield notes outstanding. While the
target's other three outstanding note series were
refinanced through a tender offer and $1.1 billion
worth of new notes, it made economic

sense not to refinance the secured tranche. A
consent solicitation to permit the acquisition, and new
tranches and credit facilities that complied with the
outstanding tranche's restrictive covenants, would have
been difficult in any market. So the deal completing in
July makes it all the more

This consortium acquisition of Nortel Network's patent
portfolio for $4.5 billion was the largest patent auction in
history, and involved the sector's major players. Ericsson led
the consortium including Research in Motion (RIM), Apple, Sony,
Microsoft and EMC Corporation to secure an unlikely victory
over cash-heavy Google in this patent war battle.

The key to the deal was the consortium's unique, yet simple
structure. To encourage more parties to join the group and
provide much needed cash, a system was devised whereby parties
stated what patents they wanted, and were given what amounted
to tickets based on their cash contributions. Distribution of
the patents would be based on the ticket allocations. After
Apple jumped on board in the final rounds of bidding, the
consortium walked away with the most sought after assets to
come out of the Nortel bankruptcy.

Runners-up

ArcelorMittal and Iron Ore
Holdings/Baffinland Iron Mines
Nunavut Iron of Iron Ore Holdings, backed by US private
equity firm Energy and Minerals Group, made an
unsolicited take-over bid for Baffinland Iron Mines at
$0.80 per share in September 2010. The hostile offer
could have meant subordinated shares for Baffinland
investors, so a white knight was needed. ArcelorMittal
offered $1.10 per share a couple months later, and a
bidding war was underway.

After months of counteroffers and two hearings
before the Ontario Securities Commission (OSC),
regarding Baffinland shareholder rights plans, the
bidders joined forces and acquired Baffinland for $590
million $1.50 per share (almost twice as much as
the original offer). The acquirers' weren't through
with the OSC, though. Nunavut already owned some
Baffinland shares which needed to be converted into
common equity.

Braskem/Dow Chemical polypropylene
business
Brazil's largest petrochemical company, Braskem,
acquired Dow Chemical Company's four polypropylene
factories last September for $323 million. The catch
was that Dow's polypropylene units were located right
in the middle of its other businesses which were to
continue operating under Dow. In a sector with such
sensitive intellectual property concerns, this required
carefully structured protections. The solution came in
the form of over 40 ancillary documents regulating the
day-to-day operations of the businesses, with
provisions allowing for future collaboration.

Grupo Sura/ING Latin American
businesses
Grupo de Inversiones Suramericana's (Grupo Sura)
acquisition of ING's Latin American pensions, life
insurance and investment management operations for $3.8
billion was the largest ever acquisition by a Colombian
company, and the largest ever exclusively Latin
American cross-border M&A deal.

To finance the acquisition, the Colombian pension
fund raised $1.82 billion in the largest ever Colombian
share issuance and made special financing arrangements
with UBS including a syndicated loan, equity investment
and a preferred stock issuance.

Innovation didn't end with the sheer size and
complicated financing of the deal, though. Mexican laws
on the establishment of foreign financial institution
affiliates needed amending to allow for assets to be
held in special purpose vehicles across Holland, Spain
and Colombia.

Harbin Electric take-private
China-based Harbin Electric, which had listed on the
Nasdaq via a reverse triangular merger in 2005,
achieved a 186% premium per share in its $754 million
sale to Harbin Chairman & CEO Tianfu Yang.

Last year's negative publicity surrounding Chinese
reverse mergers caused extreme volatility in Harbin's
trading price and made it difficult for Yang to secure
financing from China Development Bank. And when Harbin
shareholders wouldn't agree to a deal until Yang
secured financing, a stand-off followed.

The solution came in the form of a provision which
was drafted to give Harbin's Special Committee of the
Board of Directors the exclusive ability to unwind the
deal if financing couldn't be secured, giving
shareholders the confidence needed to sell.

Sanofi-aventis/Genzyme
Sanofi-aventis's hostile acquisition of Genzyme for
$20.1 billion involved a complicated contingent value
right (CVR) based on the performance of a new drug in
development by Genzyme. French pharmaceutical company
Sanofi-aventis and Boston based Genzyme had greatly
differing opinions on the value of Genzyme's yet to be
released drug, so they used a CVR to set performance
milestones which, if and when were satisfied, would
result in an additional $3.8 billion for
shareholders.

A further complication was the hostile takeover
being litigated in the state of Massachusetts. There
are few precedents in this jurisdiction, which
increased uncertainties.

Private equity: Berkshire Partners and OMERS/Husky
International

Canadian pension fund OMERS Private Equity teamed up with
US-based private equity fund Berkshire Partners in the C$2.1
billion acquisition of Husky International from Onex
Corporation. This was the largest private equity acquisition of
a Canadian company last year. The deal is expected to signal
the beginning of a trend in US and Canadian joint acquisitions.
There were never-before-seen complications arising from the
cross-border nature of the buyers, and the team also had to
find a way for the pension fund to hold the assets in
accordance with exchange controls and investment criteria.

Berkshire and OMERS were represented by McCarthy
Tétrault in Canada and Weil Gotshal & Manges in the
US. Onex and Husky were represented by Torys in Canada and
Fried Frank Harris Shriver & Jacobson in the US. Simpson
Thacher & Bartlett acted for JP Morgan Securities and
Evercore Partners as financial advisors to Sanofi-aventis.

Runners-up

Mirae Asset Private Equity and Fila
Korea/Acushnet
The acquisition of Acushnet, a golf equipment
manufacturer, from Fortune Brands by Mirae Asset
Private Equity and Fila Korea represents the first move
by a Korean private equity fund to acquire a leading
global brand. Korea Development Bank and the National
Pension Service of Korea financed the deal, making the
buy-side completely Korean. This deal is understood as
a great source of pride for South Korea and a symbol of
things to come. Some bidders expressed concern over
potential environmental and intellectual property
litigation, but the Mirae and Fila team agreed to take
on all risk in this regard. So far, it seems it was a
good gamble.

Samson Investment buyout
The acquisition of Samson Investment Company is another
data point in last year's trend of private equity firms
teaming up with strategic acquirers. A consortium led
by KKR and including Natural Gas Partners and Crestview
Partners needed third party equity to fill the gap
between high yield, bank credit and bank equity
financing in their buyout of the target.

Japanese trading company ITOCHU joined the
consortium and Samson was acquired for $7.2 billion in
the largest private equity deal since 2007. Strategic
companies and private equity firms typically have
different timeframes and partnership agreements in mind
when making these types of acquisitions, which
complicated setting the terms of the consortium. The
deal is representative of the increasing importance of
Japanese investors in the marketplace, especially under
a strong Yen.

TMM Holdings/Taylor Morrison and Monarch
Homes
The acquisition of Taylor Morrison and Monarch Homes,
both north American subsidiaries of UK-based Taylor
Wimpey, is another example of private equity funds
teaming up to bolster their buying power in a
recovering market. US-based TPG Capital and Oaktree
Capital Management, along with Canadian fund JH
investments, established a limited partnership, TMM
Holdings, to acquire the homebuilders for $1.15 billion
last July.

It was an all equity deal with a portion sponsored
through bridge financing, which is unusual for a
transaction of this size. This, along with the absence
of a reverse breakup fee and equitable remedies, gave
Taylor Wimpey some comfort that the deal would close.
It did, but not without having to be approved by
Canadian, US and European Commission regulators.

The acquirers were advised by Paul Weiss Rifkind
Wharton & Garrison. TPG capital was represented by
Ropes & Gray in the US and Stikeman Elliott in
Canada. Debevoise & Plimpton acted for Oaktree
Capital and McCarthy Tétrault was on for JH
Investments. Cravath Swaine & Moore represented
lenders to the acquirers. The sellers were represented
by Davis Polk & Wardwell in the US and McMillan in
Canada.

Brazil's export boom has left its ports in desperate need of
development. Embraport, a greenfield private terminal in the
country's busiest port in Sao Paulo, has paved the way for
further investment in this sector through its unprecedented
financing arrangement.

The $786 million brought together for the first time three
of the region's biggest lenders (the Inter-American Development
Bank (IDB), BNDES and Caixa Econômica Federal) and showed
how to satisfy each of their policy requirements.

A multi-tranche and dual currency deal was negotiated which
allowed IDB and BNDES to have separate loan agreements.

Marrying the two financings created first-of-its kind
intercreditor issues, the resolution of which greatly increases
the possibilities for large-scale financings in Brazil. One key
intercreditor issue was IDB's commercial B lenders' hedge
providers sharing collateral on a parri passu basis. This
marked the first time that BNDES has agreed to this.

Runners-up

Juan Santamaria International
Airport
The restructure and refinancing of Costa Rica's
international airport involved a distressed debt
acquisition, refinancing of an existing loan,
renegotiation of a concession, and a new financing. The
deal closed in September after three years of
negotiations on four fronts.

When the lawyers got involved they faced the first
failed public concession in Costa Rica, and banks that
had exercised their step in rights.

Simpson Thacher & Bartlett was counsel to the
borrower and sponsor. The lenders received US law
advice from Clifford Chance and local advice from BCM
Abogados. The project sponsors were served by Azevedo
Sette Advogados as Brazilian counsel and Ogilvy Renault
as Canadian counsel.

OSX 2 floating production and offloading
vessel
Amid the many Brazilian drillship financings of late,
this deal by OSX stands out for not being backed by an
upfront and long term Petrobas charter. Instead, OSX 2
will be chartered by another Eike Batista group member
OGX, which is pre-production and pre-cashflow.

There were a number of bankability issues: the
charter was not yet fully embedded on the market; OSX 1
had already been delivered and was ready for first
production, and; the construction had not yet begun
meaning the project carried full construction risk.

Allen & Overy represented the sponsors with the
lenders advised by White & Case on US law and Souza
Cescon Barrieu & Flesch on Brazilian law.

PR-22 and PR-5 concession
With the backdrop of a developing public private
partnership (P3) market, and after some high profile
brownfield P3 failures, the concession of Puerto Rico's
PR-22 and PR-5 toll roads is important in showing that
well structured project privatisations can be done in
the US.

The $1.1 billion deal was the US's first brownfield
P3 in five years, the first north American post-crisis
project to carry full traffic risk, and the first
project under Puerto Rico's P3 programme.

Russell City Energy Center
The Russell City Energy Center overcame opposition and
stringent approval requirements, and a shaky start for
its majority sponsor, to close last June, four years
after its first contact was executed.

The project's biggest hurdle was the community
challenge and litigation against the granting of its
air quality permit.

White & Case acted for the sponsor and Latham
& Watkins for the lenders.

Taboada Wastewater Treatment Plant
Project
The financing of Peru's Taboada Wastewater Treatment
Plant builds on IFLR's America's 2011 project finance
deal of the year, the Huascacocha hydroelectric
project, but required adjustments to the government
payment scheme to accommodate multiple projects, made
this a more difficult deal to pull off.

The issuer retained Chadbourne & Parke as US
counsel and Estudio Ávila y Abogados as local
counsel. DLA Piper and Rubio Leguía Normand
acted in corresponding roles for the arranger and
initial purchaser. Maples and Calder advised on Cayman
Island issues and Hogan Lovells acted for the indenture
trustee.

Zapallal  Trujillo Transmission
Line
The $160 million financing of the transmission line
connecting Zapallal to Trujillo in Peru used a trust
structure, rather than an SPV, for the first time in
the country. Using trusts allowed the sponsor to
isolate project risks and not jeopardise its bonds and
corporate AAA rating.

Estudio Santivañez Abogados represented the
concessionaire and Estudio Echecopar acted for the
lenders.

Restructuring: Angiotech Pharmaceuticals

The key to the $600 million restructuring of Angiotech
Pharmaceuticals was having the proceedings carried out in
Canada under the Companies' Creditors Arrangement Act (CCAA),
with a simultaneous filing under Chapter 15 in the US.
Angiotech is based in Vancouver but 80% of its assets are held
in the US. Having the lead proceedings in a Canadian court
allowed for the lightest possible touch of reorganisation and
the best outcome for shareholders.

The transaction involved an in-court CCAA restructuring of
subordinated notes and a concurrent out-of-court exchange offer
of floating rate notes with limited voting rights. This was a
first in Canada and it is expected to become a precedent. US
courts were thought unlikely to approve this aspect of the
plan, and though the senior noteholders challenged this in the
Canadian courts, they eventually settled allowing Angiotech to
emerge from bankruptcy in May.

Runners-up

Caribbean Petroleum
In 2012 Caribbean Petroleum filed for bankruptcy under
US Chapter 11 following its liquidity crisis caused by
an explosion at its Puerto Rican facilities a year
earlier. Making matters worse, the EPA had ordered the
company to shut down its remaining tanks, meaning it
had no operational income to pay a seemingly endless
number of tort and debtor claims. The company obtained
debtor-in-possession financing from Banco Popular de
Puerto Rico receiving approval for a section 363
auction of its assets.

One problem remained: Caribbean had franchise
agreements with up to 80 service stations, meaning any
purchaser would have to agree to terms with each
service station operator. A bankruptcy court decision
allowed for the rejection of those franchise
agreements, paving the way for Puma Energy Caribe to
purchase substantially all the Caribbean assets.

Graceway Pharmaceuticals
Substantially all the assets of Graceway
Pharmaceuticals were acquired by Medicis Pharmaceutical
Corporation in a stalking horse auction for $455
million, up from an intial bid of $275 million by
another company. The sale could not have happened if
not for the innovative idea to apply to the Ontario
Superior Court for an appointed receivership.

Medicis wanted vesting order certainty in its
acquisition of Graceway assets, which could have been
granted under the Canadian or US bankruptcy regimes if
not for the fact that Graceway's Canadian subsidiary
had been providing debtor in possession financing for
its US parent. The solution was to appoint a Canadian
receiver for the sole purpose of giving the court
oversight of the sales process. This protected
stakeholders in Graceway's Canada subsidiary, and
allowed for a vesting order. A receiver had never been
used to facilitate a cross-border sales process
before.

Napcus
North American Petroleum Corporation (Napcus) wanted to
emerge from Chapter 11 protection as a private company
to escape costly disclosure requirements for trading
its shares on US and Canadian exchanges. An innovative
restructuring plan valued at over $100 million was
developed in coordination with an equity committee
which allowed Napcus to remain under US and Canadian
public company shareholder thresholds, with a back-up
plan to return to public company-status when it had the
cash reserves to do so.

This plan divided existing shareholders into two
classes, with one receiving shares when the plan took
effect and the other receiving a delayed distribution
of shares or cash equivalent. This gives Napcus the
time it needs to generate cash for public company
disclosure requirements, or pay the delayed
distribution shareholders. The plan was approved in
September, and left Napcus with cash reserves.

South Edge
The South Edge joint venture brought together eight
homebuilding companies to create Inspirada, a real
estate project outside of Las Vegas. The project had
been stalled since the 2008 subprime mortgage crisis,
and with the loans being off the joint venture parties'
balance sheets, there was little incentive for the
homebuilders to act.

Rather than commencing an arduous foreclosure
process for modest returns, the secured lenders 
JPMorgan Chase, Crédit Agricole Corporate and
Investment Trust and Wells Fargo  took the
unusual move of filing an involuntary bankruptcy
petition against the homebuilders.

Travelport
This $3.8 billion restructuring of Travelport included
a complicated out-of-court backup prepackaged
reorganisation plan which encouraged lenders to extend
the maturity date of $715 million in unsecured payment
in kind loans, some of which were split into two debt
tranches.

A derivative developed by BNP Paribas enabled mutual fund
Janus to offer retail investors growth potential and a degree
of downside protection they had never seen before. The deal
made Janus Protected Series  Growth fund the first
US-based capital protection mutual fund to offer daily
liquidity and be open-ended.

The key to the downside protection is the strike price
moving up in accordance with the most recent NAV, offering
protection at 80% of the previous figure. Offering retail
investors this type of certainty and over a 10-year term was
totally new, though since its launch last May, it has been
replicated by others in the market. Offering increasing amounts
of protection (up to $1.5 billion) over such a long-dated deal
complicates the hedging required of the derivative provider
 perhaps a reason why it hasn't been done before, but BNP
had the expertise to do this.

CapOne forward sale
Capital One's acquisition of ING's US operations, ING
Direct, has been hailed an encouraging sign for the
region's M&A market. Less known, but just as
interesting, is the efforts needed to secure sizeable
and certain financing for a bank in last year's choppy
debt markets.

The acquirer knew it needed to issue equity as part
of the capital structure, but the August volatility was
fast approaching. To achieve certainty of execution and
within set price parameters, the solution was a forward
sale of 40 million shares for $2 billion. This was one
of the largest issuer forwards ever executed, and
certainly the largest in some time and for a financial
institution.

Further rarities were it being a post-paid deal and
a Goldman II deal. With capital requirements bearing
down on banks, the deal has been tipped as an example
of how to raise equity with maximum certainty.

Gibson Dunn & Crutcher acted for the issuer.
Morrison & Foerster was counsel to the underwriters
and dealers on the forward.

Desjardins' global covered bond
programme
Last March Canada's Caisse centrale Desjardins du
Québec became the first credit union in north
America to complete a covered bond deal. Establishment
of the 5 billion programme and its first $1
billion issuance needed a structure that accommodated
the mortgages being held by dispersed caisses. A
two-step loan sale structure was needed to bring the
mortgages into the SPV issuer, along with corresponding
double cash-flow, servicing and maintenance mechanisms.
Perfecting these flows was needed for investor
confidence and approvals, and despite the mortgages
being isolated in Quebec rather than diversified around
the country like most covered bond pools, the deal was
a success.

Cleverly, the lawyers structured the deal to comply
with Bank Act restrictions imposed on bank covered bond
programmes. Even though Derjardins is not subject to
these restrictions, complying with collateral and
mortgage requirements helped the deal achieve a
bank-like rating.

The issuer's US counsel was Mayer Brown with
McCarthy Tétrault acting as Canadian counsel.
Allen & Overy provided US advice to the managers
and Osler Hoskin & Harcourt advised on Canadian
law.

Fovissste MBS
Fovissste's $450 million mortgage-backed securitisation
in August is well-known in the market, and for good
reason. The issuance by Mexico's state-sponsored
mortgage provider was the country's first government
cross-border MBS without a third party guarantee. It's
also a rarity to see international MBS from a Latin
American issuer  the region's securitisation
markets are predominantly domestic. Mexico's real
estate market has had similar woes of the US, so a
secondary market offering by a debut issuer is also
impressive.

Perhaps the most notable elements of the deal,
however, stem from the issuer. Six years ago Fovissste
was plagued by allegations of corruption, inefficiency
and bureaucracy. For it to close this deal with no
third party enhancement is laudable.

PowerShares DB Inflation/Deflation
ETNs
Deutsche Bank closed 2011 by launching an innovative
ETN which transforms inflation from an economic concept
to an asset class. Together with PowerShares, Deutsche
issued two ETNs linked to US inflation expectations.
These ETNs go a step beyond Treasury Inflation
Protected Securities (TIPS), which are often used to
gain exposure to inflation, by removing interest rate
risk from the returns.

Deutsche Bank was advised by Davis Polk &
Wardwell.

VelocityShares/Credit Suisse VIX
ETNs
Credit Suisse started 2011 with the NYSE Arca bell
ceremony for its VIX-related ETNs, It turned out to be
a good year to introduce a programme based on the
volatility index for the Chicago Board Options
Exchange. Created by VelocityShares, the programme's
notes include the first to offer double exposure on
volatility and the first inverse volatility product.
The deal is pioneer for 2xleveraged ETNs, and is now
among the most liquid ETNs traded in the US.